Auto Care Association President and CEO Bill Hanvey testified recently before the U.S. International Trade Commission (USITC) in Washington, D.C., on the likely economic impact of the United States-Mexico-Canada Agreement (USMCA). The USITC instituted the investigation last month in response to a request from U.S. Trade Representative Robert Lighthizer following the release of the USMCA text.

“NAFTA was an important regional free trade agreement that contributed to the growth of our industry over the past 20 years,” said Hanvey. “In 2017, the U.S. exported $61 billion in auto parts to Mexico and Canada, accounting for more than 70% of all auto parts exports. We supported the Trump administration’s efforts to modernize NAFTA and reach a new U.S.-Mexico-Canada agreement (USMCA), allowing duty-free movement of auto parts to continue between the three countries.”

Hanvey explained that although “the USMCA will result in increased investment and/or reshoring of production into North American supply chains,” the Auto Care Association is concerned with a few provisions in the USMCA, including increased rules of origin, new certification requirements, sunset provision and quotas capping imports exempt from the pending Section 232 autos and auto parts investigation.

“We urge the Commission to consider fully in its report the long-term implications of the USMCA on the automotive industry and urge the ITC to closely consult with the industry during the agreement’s implementation and evolution. Our industry’s ability to remain globally competitive supports U.S. auto exports, provides U.S. consumers with a wider selection of vehicles and parts, and keeps vehicle repair and maintenance costs affordable for working families.”

The Auto Care Association said it plans to expand on these issues in its written comments due to the International Trade Commission in December.